UAE-based Abu Dhabi Crude Oil Pipeline LLC (ADCOP) is a limited-purpose entity created to own a 382-km crude oil pipeline from Habshan to Fujairah.
We are assigning our preliminary 'AA' long-term rating to ADCOP's proposed US$3,069 million senior secured bonds.
The proceeds from the issuance will be used to repay a portion of the shareholder loan incurred to acquire the asset.
We base our rating on the creditworthiness of Abu Dhabi Company for Onshore Petroleum Operations Ltd. (ADNOC Onshore), the sole operation and maintenance provider for the pipeline and the sole off-taker. ADNOC Onshore is 60% owned by Abu Dhabi National Oil Company (ADNOC), which is 100% owned by the Abu Dhabi government (AA/Stable/A-1+).
The stable outlook reflects our expectation that ADNOC Onshore will maintain and operate the pipeline to ensure smooth operations and make timely payments to ADCOP. Furthermore, it reflects our expectations that ADNOC Onshore will remain integral to the ADNOC group's strategy. The stable outlook also reflects that on the Abu Dhabi government, the ultimate owner of the pipeline.
On Oct. 18, 2017, S&P Global Ratings assigned its preliminary 'AA' long-term rating to the $3,069 million senior secured bonds to be issued by Abu Dhabi Crude Oil Pipeline LLC (ADCOP), a United Arab Emirates (UAE)-based limited-purpose entity that owns a 382-km crude oil operational pipeline from Habshan to Fujairah. The issuance will be split into US$869 million Series A due 2029 and US$2,200 million Series B bonds due 2047. The outlook on the rating is stable.
The final rating will depend on our receipt and satisfactory review of all final transaction documentation. Accordingly, the preliminary rating should not be construed as evidence of the final rating. If S&P Global Ratings does not receive final documentation within a reasonable time frame, or if final documentation departs from materials reviewed, we reserve the right to withdraw or revise our ratings. Potential changes include, but are not limited to, utilization of bond proceeds, maturity, size and conditions of the bond, financial and other covenants, security, and ranking.